On Monday, Bank of Mongolia (central bank) increased its 10 percent policy interest rate up to 11 percent after the country’s policy makers admitted the inflation has soared into double-digits thanks to the government’s recent social transfers.
At the press conference, the country’s top bankers grounded inflation rate as the main reason which saw an increase by 11 percent compared to last month.
Minister Finance S.Bayartsogt said at the Parliament hearing that the government’s cash give-away program of MNT70,000 to each eligible citizens from its sovereign wealth fund “Human Development Fund” and decision to increase salary and pension by 30 percent effective from October have caused inflation hike. Top bankers feared that the inflation may reach same level of last year’s 34 percent.